An American Crypto startup Bitwise Asset Management is among the recent financial firm which has applied for a new bitcoin exchange-traded fund (ETF).
Bitwise is seeking regulatory permission with an aim to resolve the regulatory concerns that caused failure of previous attempts. Also, the newly applied Bitcoin ETF is different from the previous applications of Bitcoin ETFs. To represent the market more efficiently, Bitwise proposed Bitcoin ETF that draws prices from various crypto exchanges. Additionally, this Bitcoin ETF needs “regulated third-party custodians to hold its physical bitcoin.”
Explaining more about the filing of Bitcoin ETF, Bitwise global head of Exchange-Traded Funds John Hyland spoke his mind noting that the SEC may not grant the application. He added, “We believe the crypto trading ecosystem has evolved in significant ways in the past year … Having a regulated bank or trust company hold physical assets of a fund have been the standard under U.S. fund regulation for the last 80 years, and we believe that is now possible with bitcoin.” Hyland expressed, “we are optimistic that 2019 should be the year that a bitcoin ETF launches.”
The application by Bitwise shows that the proposed ETF will track the Bitwise Bitcoin Total Return Index measuring the value of bitcoin, plus any “meaningful hard forks.” According to the form, it will track the value of which is “calculated based on the prices of bitcoin that the Index Provider derives from bitcoin price transactions occurring on cryptocurrency exchanges.”
Also, the global head of research Matt Hougan at Bitwise stated that the team had spent the past year working on the questions by the SEC in the past. Notably, if the ETF gets approval, then NYSE Arca will feature its shares under a ticker symbol. NYSE Arca is the exchange which focuses on trading stocks and options.
The Japanese financial regulators have shown reluctance regarding the approval of Bitcoin exchange-traded funds (ETF). In the US, crypto enthusiasts are keenly waiting for SEC’s decision on ETFs. On that, an SEC commissioner advised “not to hold your breath” waiting for a Bitcoin ETF, in December. ETF is actually security which tracks an asset or a group of assets. It can be traded the same way in which stocks are on an exchange.